Only one in five term deposit accounts is paying above 1 per cent interest, according to Canstar data.

That ratio lifts to one in two for general savings accounts.

But after the major banks took a knife to interest rates this week, money experts are urging young savers and retirees to save some cash by looking beyond the Big Four banks.

On Thursday, Commonwealth Bank quietly slashed the introductory rate on its NetBank Saver Account by 5 basis points, to 0.05 per cent, and the bonus rate for GoalSaver accounts with balances exceeding $50,000 by the same amount.

Youthsaver account holders were also slugged with a second interest rate cut in just six weeks. This time their rate fell by 10 basis points.

Meanwhile, NAB’s one-, two- and three-month term deposit accounts will be subjected to interest rate cuts of between 5 to 15 basis points.

All the Big Four banks are now paying a base rate of just 0.05 per cent on their savings accounts.

Canstar editor-at-large Effie Zahos said the latest round of cuts proved young savers and retirees were the biggest casualties of the banks’ home loan pricing war.

According to Canstar’s database, 50 per cent of savings accounts and 80 per cent of term deposits across the banking sector now have a total rate of less than 1 per cent.

And Ms Zahos told The New Daily the pain will be prolonged for savers as banks try to balance their books with tightly-squeezed margins.

“Things are very tight on the other side of the balance sheet with mortgages, we’re seeing this play out in the ASX reporting reason, so it’s a case of you can find a home loan at 2 per cent, but you would be hard-pressed to find a savings rate at that rate,” Ms Zahos said.

“While this money is guaranteed, those people either have to be prepared to eat into their capital because they can’t live off the interest, or dial up the risk which is the hardest thing to do in a pandemic.”

Another alternative, however, is to pursue some of the higher savings rates available with less-well-known banks.

Some lenders – including Heritage Bank, Macquarie Bank and Rabobank Australia – offer short-term rates that are more than double those offered by the big four, if you include their introductory promo rates.

Others, such as VOLT and ING, offer a continuous rate of 1.65 per cent.

But many accounts do not allow savers to earn bonus interest over certain caps (many over $100,000), with interest rates reverting to a lower base rate for earnings over that amount.

Ms Zahos said savers stand to gain by “playing leap frog” and shopping around for a better deal, but warned them to read the fine print before jumping towards a flashy headline rate.

“After four months, some of these rates drop down to 0.8 per cent, so you don’t want to find yourself back at square one – you might need to continually search around, which is a bit of a hassle,” Ms Zahos said.

“The days [when] you [could] leave your investments in one account and just let it sit there and hum along nicely are long gone in this pandemic environment.”

Ms Zahos said another viable option could be mortgage offset accounts, which are tied to the higher interest rates being paid on a home loan.